Cointegration and control: Assessing the impact of events using time series data

Control groups can provide counterfactual evidence for assessing the impact of an event or policy change on a target variable. We argue that fitting a multivariate time series model offers potential gains over a direct comparison between the target and a weighted average of controls. More importantly, it highlights the assumptions underlying methods such as difference in differences and synthetic control, suggesting ways to test these assumptions. Gains from simple and transparent time series models are analysed using examples from the literature, including the California smoking law of 1989 and German reunification. We argue that selecting controls using a time series strategy is preferable to existing data‐driven regression methods.     

It is not just about paying your dues: Impact of generational cohort on active and passive union participation

The lack of a validated measure of active–passive union participation and a dearth of research into the relationship between generational cohort and union participation challenge union leaders to develop policies and practices to facilitate union renewal. We address these issues by (a) developing a multidimensional measure of union participation that captures both active and passive components, (b) using structural equation modelling to validate the measure within a nomological framework, and (c) investigating the impact of generational cohort on all paths in our framework. Data from members of a large American union confirm that generational cohort influences how union members participate in their union. The two‐factor measure developed in this study facilitates research into antecedents and outcomes of passive and active union participation. Our findings should also prove useful to unions seeking to increase participation within their membership, academics researching unions and generational cohort, and human resource practitioners operating in unionised environments.     

Time series copulas for heteroskedastic data

We propose parametric copulas that capture serial dependence in stationary heteroskedastic time series. We suggest copulas for first‐order Markov series, and then extend them to higher orders and multivariate series. We derive the copula of a volatility proxy, based on which we propose new measures of volatility dependence, including co‐movement and spillover in multivariate series. In general, these depend upon the marginal distributions of the series. Using exchange rate returns, we show that the resulting copula models can capture their marginal distributions more accurately than univariate and multivariate generalized autoregressive conditional heteroskedasticity models, and produce more accurate value‐at‐risk forecasts.     

Brexit: How Will UK Agriculture Fare?

There is little doubt that Brexit would have significant implications for UK agriculture, a sector with strong trade links to the EU and strong reliance on CAP income support. This article reports preliminary results from employing a Computable General Equilibrium Model, a Partial Equilibrium Model and Farm Level Models to explore selected trade and domestic policy scenarios post‐Brexit. These allow for the estimation of changes in producer prices, production and farm incomes against a baseline scenario of continued EU membership. Under a Free Trade Agreement with the EU, agricultural impacts are relatively modest. By contrast, unilateral removal of import tariffs has significant negative impacts on prices, production and incomes. Adoption of the EU's WTO tariff schedule for all imports favours net importers (e.g. dairy) and harms net exporters (e.g. sheep). Given the strong dependence of most UK farms on direct payments, their removal worsens negative impacts of new trade arrangements and offsets positive impacts. Impacts vary across different types and sizes of farm, but also regionally. However, the period of adjustment to new trade and domestic policy conditions may prove very challenging for a large number of farm businesses.     

An Illuminating Exchange The Construction of Social Reality

A BSTRACT . In his The Construction of Social Reality , Searle presents an account of rights, responsibilities, obligations, duties, and similar entities in terms of the formula X counts as Y in context C , where " X " refers in the simplest case to some physical object or event and " Y " to the result of imposing upon X some deontic power or function. Smith attempts to show the limitations of this formula, focusing especially on the examples of contested property rights (where C is not uniquely defined), and of money in bank accounts and other phenomena (where no physical X -term is available). Searle responds to these criticisms, above all by pointing to the fact that some of the problems Smith raises are to be addressed not by an ontological analysis of social reality but rather through legal or political means.     

Housing Transactions and the Changing Decisions of Young Households in Britain: The Microeconomic Evidence

In this second of two related papers in this issue, the causes of declining levels of housing transactions in Britain during the 1990s are explored. The lower transaction levels resulted partly from the changing behavior of young individuals. Both household formation and owner–occupation rates of these groups also fell sharply. Using panel data, we investigate the causes of reduced new household formation and owner–occupation, finding that changes in the income distribution away from young cohorts have been an important factor.